There has been tremendous blame levied on the finance industry for buying up collateralized debt obligations. And this makes intuitive sense since we ought to expect them to exercise better personal judgment. The little known fact is that their personal judgment has been largely crowded out by the SEC and replaced by its own list of approved judges.

In 1975 the SEC began requiring the use of credit rating agencies that only the SEC could approve. At the time, the requirements for using these agencies were limited in scope, but in the past 30 years this has grown in scope to the point where only a handful of companies are the de facto judge and jury for financial worthiness. In effect the SEC has crowded out independent judgement by sanctioning these rating agencies.

It is amazing the SEC has faced so little public criticism for its role in this debacle as well as the Bernie Madoff scandal where it completely failed to protect investors. It is about time we stop pretending the SEC protects us and start reinstituting private credit rating agencies with full latitude to find and prevent such meltdowns.

“God grant me the serenity to accept the things I cannot change; courage to change the things I can; and wisdom to know the difference.” — Reinhold Niebuhr

I am an atheist, so I don’t pray to God. But as an engineer it’s my job to apply technical knowledge and tools to create change, so Neibuhr’s prayer is valuable to me. The leaders I admire the most are the ones that can break down some of the largest constraints to create powerful change. We laud someone like Steve Jobs because we like our iPods, but they only exist because he and Apple could reshape the constraints of the music industry.

When I have taken it upon myself to challenge constraints, it has usually paid dividends and helped me grow. So I stop to check premises when I hear or think to myself:

We don’t have enough time to do that

That’s not in our scope

This technology doesn’t work that way

We don’t have enough manpower to do that

All of these are flavors of the time/resources/scope project management triangle. The interesting thing about each factor is that it’s largely self-imposed by you, your team or your company. Do you really have to ship this month or would you rather have the feature that makes the product actually usable? Why can’t we afford to hire a person if we’ll make another million in profit?

Of course you are already thinking ahead and wondering “some of these constraints are good. We can’t wait forever to ship!” And you’d be right. So next time someone gives you the constraint in the first place, work to understand why it exists, who set it, and what purpose it serves. Because tomorrow you may be the self-appointed leader that changes them.

When you find the time is right to break a constraint, here are some tips:

Understand who you have to convince: who set the constraint before? Who are you allies in making the change?

Talk about the positive result you expect: ‘customer experience for first run is smooth.’

Contrast that with the result of status quo: ‘customers will likely fail and end up calling support; COGS goes up 50%, profit margin down 50%.

Demonstrate an understanding of the original constraint: ‘We have to reschedule our launch event; here’s how we could get started on that.’

Reframe the constraint: ‘the new deadline should by x month, and the only conditions for changing it should be y, we have higher confidence we can stick to it because of a,b and c.’

So what constraints are you fighting in your organization? Which ones are the healthiest constraints that make you more productive?

A friend recently asked me how the economy in China is doing. He had recently read an article that projected the situation as quite grave with more vacancies than not, failing vendors, etc.

I thought my reply was worth posting here:

On a purely anecdotal level, I don’t see that it has reached the level of saturation the article would have you believe. This is based simply on my own experience in Shanghai and Beijing. I don’t think a true reckoning has happened yet; my educated guess is that worse is coming.

I have seen new buildings that are entirely vacant. Having been in both Shanghai and Beijing, it’s not quite so extreme as the 3:1 ratio, in fact it ostensibly seems like at most 1 in 10 is unocupied.

At the market vendors do mention they are having a slow day. There is quite a bit of foot traffic and sales are happening. They are not offering desperately low prices. While the deals are cheaper than what I would pay in the U.S., I am well above their own cost basis.

In Seattle, Northwest Air has chosen to delay indefinitely opening up a Beijing flight they had bid for and secured. Hainan Airlines, which has a direct Seattle/Beijing flight, has mostly empty seats I hear.

It makes sense that China would be lagging behind the U.S. economy, since we import so much from them. And even in the U.S. the worst has not come yet.

I had my first Chinese lesson tonight. There is a lot to take in, and I am not really good at memorization. One of the things that confused me right away is the words for siblings. Rather than just brother and sister, there is a separate word to indicate if they are older or younger:

didi

younger brother

gege

older brother

meimei

younger sister

jiejie

older sister

This is telling and indicates just how much seniority in the family matters.

In practice though, I have found talking about siblings is a fruitless conversation topic, because all my coworkers have no siblings. The family plan limits parents to a single child. This is only now starting to loosen. For example if both wife and husband come from families with only one child, then they can have two kids. Or if you have three years salary laying around, you can buy rights to have a second kid.

In the meantime, memorizing these four words is low on my priority list.

I am starting to learn Chinese so that I can fit in better here. It is actually surprisingly easy to get by without learning a single word. Many of the young people here speak English, most menus have pictures and the signs almost universally have English translations on them. That said every time I utter even the most basic Chinese phrase I get a big smile of appreciation. And getting by is great, but I want to actually meet people and learn about the culture here.

I thought it was worth chronicling this as a way to help me commit things to memory. Also, if you have friends or work with anyone that has a Chinese name you are probably butchering the pronunciation. There are a few letters that sound radically different:

q

sounds like ‘ch’ in English

x

sounds like ‘sh’ in English

zh

sounds like ‘je’ in French

i

sounds like ‘ee’ in tree

To put that in practice, here are some common last names and their pronunciation:

Li

sounds like Lee

Zhang

sounds like je + ahng

Xie

sounds she + a

Speaking of last names, it is customary to say someone’s last name first, then their given name. If you say someone’s first name only, it means you are good friends–giving new meaning to ‘on a first name basis’.

Those are the biggest gotchas. For more details on pronounciation see Introduction to Pinyin which explains Tones and also has a recording of every phonic.

I just got into Beijing a few days ago. One of the big differences from Shanghai is that there are fewer scooters and motorcycles around. In Shanghai, these bikes had free reign over the sidewalk.

The one thing that’s still true in Beijing is that as a pedestrian, you are at the bottom of the food chain. If you step into a cross walk, don’t expect cars to yield to you even if you have a green crossing sign. Often you’ll want to cross and have to wait for a whole string of cars to go by you.

The good news is that j-walking is at a higher level of sophistication here. When cars are making their left turns, people will walk diagonal across the intersection. This is a nice time saver if you need to cross in both directions!

My first assignment this morning was to go to the Quarantine Bureau to get a physical exam. I was a bit perturbed, because I had already gone through this process in the U.S. but they didn’t get my paperwork in time. It turned out to be surprisingly easy. Back home it took almost 2 hours for them to do my exam. Here they had it down to a factory line and had me in and out in 20 minutes. Most of the time was just waiting for my number to be called. Again another case where they’ve been forced to figure out a better way, having 1 billion people—I was impressed.

After an expensive, but unremarkable lunch at the hotel it was time to do some walking.

Not surprisingly there are lots of bicyclists on the roads (they have special lanes on the side, but they go where they want pretty much). And there are a slew of motorbikes, possibly more than cars themselves in fact. At several of the cross walks there is actually a special 3rd state to the light where bikes and cycles are allowed to go from any direction—it’s a fun sight to watch as they all criss-cross. The other thing, which I really liked, is that several of the street signs are actually digitally lit and show current traffic conditions. We have signs in Seattle that show estimated commute times to certain areas, but these signs actually showed you exactly where the slow areas are and let you judge for yourself how to go—love it!

People had told me there is a bit of admiration for lighter skinned people, and sure enough many of the ads I saw on billboards and posters showed Caucasian people. After nearly 2 hours of walking on the streets though, I did not see a single non-Asian person. This surprised me for Shanghai, but it might also have been the neighborhood I was in. My hotel is in the bar district, and outside the city-center.

Along the same vein, most of the younger women here have fancy brand name handbags and boots. The men, not surprisingly, are a bit more generic and don’t wear so many of the western brands.

After the long walk, I chatted with Danielle a bit and went to grab an overpriced dinner in the hotel. It’s plenty of motivation to learn more Chinese so I can get out and about more.

The team sent out Meng Tang from our Beijing office to go on customer visits with me. This is great because we need someone with at least a little SharePoint experience who can help translate. I met him n the hotel lobby to plan out our engagement with customers tomorrow. He was very easy to get to know, and the team had apparently filled him in on my penchant for Starcraft

My clock is mostly on Chinese time, but I am still a bit tired. Off to bed so I can get up energetic tomorrow.

I am joining our SharePoint Tools team in China for the next 5 months. The back-story here is that SharePoint has been so wildly successful that customers want to stretch it beyond the limits of its current design. We want to make sure our current customers our happy with the product so that by the time our next version comes around we still have customers to speak of. Towards that end, we started a team of developers and testers in China that’s staffed to build tools against our in market product. Up until now, they have had only spare resources from our Program Management team and even then only someone who’s half way around the globe in Redmond.

I left Monday morning from Seattle on Northwest Airlines. I have never been outside of North America, so needless to say this was my longest flight ever. I was near certain it was going to be a miserable experience being stuck on a plane for 10+ hours. The company flew me out business class, which turned out to be a huge difference in experience. The business class for international flights might as well be first class, if not more. Your seat reclines nearly to the point of being fully vertical, and you have quite a bit of space. I was for the first time the guy who got to board first and skips through all the nasty TSA lines, which was a great feeling. The meals served on the flight as good as you can get with the cooking facilities on an airplane. It was mainly just nice having a stewardess that was always there anytime you needed anything and it didn’t feel like you were taxing her along with 80 other people she was assigned to. The main thing is having your own personal space to just relax and read without some guy’s elbows pinning you down.

I took a couple short cat naps, but spent most of the time diving through books my family had bought me. A few nights before leaving I started to put together the details of how I was going to get from point A to B for my customers visits once I got in Shanghai. I was quickly daunted since the only good mapping software for China is of course in Chinese ideograms, not pinyin or English. Both Google Maps and Live Local were a disaster in terms of finding locations—whether by name or street address. So even after boarding the plane I had no clue where my hotel actually was relative to the city center and whether a cab driver should be charging 10 RMB or 100 RMB. Furthermore, I was told the cab drivers speak no English at all, and needed the location in Chinese ideograms. Needless to say I was not happy with this and pretty stressed out. The thought of being lost in some random city without a working cell phone, anyone I can talk to, etc. was entirely unappealing. On the plane ride I finally reverse engineered where my hotel was from one of the maps in my book and this felt light years better. I chatted up one of the stewardesses that lived in Shanghai and she helped me figure out the Maglev train out of the Shanghai airport followed by a shorter taxi ride was actually my best bet.

When the 10 hours for my flight from Seattle to Tokyo were over, I was in a hurry to get to my connection (we had left late from Seattle). This was a bit of a bummer, since I wanted to explore the Tokyo airport and at least feel like I saw a tiny nibble of Japan. Much to my pleasure, most everyone I worked with at the airport spoke English and was quite helpful when it came to getting to where I need to be.

The last leg of my trip was a relatively short 3 hour flight from Tokyo into the Shanghai airport. This was the first 747 I have ever flown in, which was kind of cool. My seat was right up in the nose of the plane. Since the cockpit is on the 2nd level, we truly were right at the head of the plane.

When I got to Shanghai, I was relieved since almost all the signs had an English translation. So it was easy to find my way around, get my baggage, and go through customs. All of which was pretty uneventful. I will say a 747 fits a ton of luggage, because despite it starting to crank out as soon as I got to the carousel, it took me forty minutes of waiting for my bags to pop out.

With 130 pounds of luggage in tow, I followed the signs to the Maglev train. When I got there I noticed the detail and craftsmanship in the uniforms the attendants were wearing. I will have to go back and take a picture some time, but suffice it to say I have never seen any uniforms in the U.S. that looked so nice, no doubt a result of having lots of hands available to do the work. The train ride itself was great. It got up to 300 km/h, which was pretty impressive, especially as you watched the oncoming traffic below the railway coming at you. In 4 minutes we were near the core of Shanghai and I took my taxi to the hotel with ideogram address in hand.

The taxi was a Volkswagen of some sort, and 80% of the cars I saw were also Volkswagens. I think I have seen 1 or 2 Japanese cars so far. This was a bit of a surprise. Inside my cab, the seat belts in the back were covered up by some sort of reupholstered seat (this appears to be a pattern in the other taxes I’ve ridden so far). And the cab drivers take it as an insult to their driving if you sit up front to take advantage of the one working seat belt.

Tomorrow I will be off to the quarentine bureau to get checked out. For now time to get some sleep, since I’ve been up for more than 20 hours now.